Johannesburg -Delta Property Fund tumbled nearly 21% yesterday after the black-owned property group warned shareholders that circumstances had risen that were being investigated by the board, which might have a material effect on its shares.
The company advised shareholders to exercise caution on the company’s securities.
There was speculation on social media as to the reason for the JSE SENS statement and possible “skeletons in the closet”, considering that the company surprised the market with the resignation of three top founding executives last month.
However, Avior Capital Markets analyst Daniel King said few facts were offered in the SENS announcement.
“It thus may be premature to link the latest development directly to the departure of the executive team. However, to the extent that further investigation by the board is required, the range of potential outcomes tends to vary between neutral (at best) to negative for shareholders. It is rare for positive news to be concealed by management,” said King.
Last month, founding chief executive Sandile Nomvete and chief financial officer Shaneel Mahataj left with immediate effect, and Otis Tshabalala elected not to complete his notice period.
Delta’s property portfolio was valued at R10.6billion for the year ended in February.
Its shares closed at 17.65% down at 28cents.